Discussion:SHAREHOLDER LOANS TO S CORP
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| Revision as of 02:06, 13 March 2007 Klesher (Talk | contribs) (Barb-this is fin) ← Previous diff |
Revision as of 04:42, 13 March 2007 MsTwizz (Talk | contribs) (Is it better to) Next diff → |
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| {{ForumReplyPost|UserID=Klesher|Date=13 March 2007|Text=Barb-this is fine. I have an 1120S client that takes draws all year, he pays the same 941 amount each month, we file payroll taxes every quarter , then at the end of the year, I get his books and find he took more draws then he should have. We take it against his loan and issue him 1099 int. }} | {{ForumReplyPost|UserID=Klesher|Date=13 March 2007|Text=Barb-this is fine. I have an 1120S client that takes draws all year, he pays the same 941 amount each month, we file payroll taxes every quarter , then at the end of the year, I get his books and find he took more draws then he should have. We take it against his loan and issue him 1099 int. }} | ||
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| + | {{ForumReplyPost|UserID=MsTwizz|Date=13 March 2007|Text=Is it better to have a shareholder loan? I booked my investment into my S corp as a capital contribution. It seems that it may be better to have the investment booked as a loan to the corp, with the corp paying me interest.}} | ||
Revision as of 04:42, 13 March 2007
Discussion Forum Index --> Tax Questions --> SHAREHOLDER LOANS TO S CORP
BARBOLEARY (talk|edits) said: | 12 March 2007 |
| I have a new S Corp client. He told me that he is planning on making period loans to the company on an as-needed basis. He will receive annual interest based on the balance and get repaid as the company sees fit (meaning $500 here or $400 there, when it can afford it). Can he do this?
I was under the impression that a personal loan to a S Corp should be for a specified amount of money. Can he make intermittent loans as he said? Is this legal? How would you handle this? | |
| March 12, 2007 | |
| Sure, no problem. At year end, document the loan balance, issue a 1099INT for the interest paid to him. No worries. | |
| 13 March 2007 | |
| Yup -- sounds about right to me JR1 (of course that is the way I do it as well...) | |
| 13 March 2007 | |
| Barb-this is fine. I have an 1120S client that takes draws all year, he pays the same 941 amount each month, we file payroll taxes every quarter , then at the end of the year, I get his books and find he took more draws then he should have. We take it against his loan and issue him 1099 int. | |
| 13 March 2007 | |
| Is it better to have a shareholder loan? I booked my investment into my S corp as a capital contribution. It seems that it may be better to have the investment booked as a loan to the corp, with the corp paying me interest. | |
